Even though life expectancy nationwide has risen over the last two decades, there is a widening gap between the most and least healthy places to live. In addition, the United States is falling even further behind other industrialized nations. According to the study, which is being published in Population Health Metrics, the worst performing counties were clustered primarily in Appalachia, the Deep South and the lower Midwest.

In West Virginia, 25 out of its 55 counties (45%) experienced a drop in life expectancy. Twenty-three counties had a drop in life expectancy for women while only fourteen counties had a drop in life expectancy for men. Furthermore life expectancy in 2007 ranged from 66.3 (McDowell) to 75.5 (Putnam) years for men and 74.7 (McDowell) to 80.2 (Marshall) years for women.

Across the U.S. counties however, life expectancy ranged from 65.9 to 81.1 years for men and 73.5 to 86.0 years for women. When compared against a time series of life expectancy in the 10 nations with the lowest mortality, counties in West Virginia range from being 14 (Monongalia) to 51 (Logan, McDowell, Mingo) calendar years behind for men and 20 (Marshall) to 47 (McDowell) calendar years behind for women.

West Virginia also fared much worse than national averages with U.S. counties range from being 15 years ahead to over 50 years behind for men and 16 years ahead to over 50 years behind for women. Moreover, between 2000 and 2007, almost every county (96% for men and 98% for women) in West Virginia fell further behind the international life expectancy standard. Although the remaining counties (Marshall, McDowell, and Putnam) did not experience a change in the international life expectancy standard, McDowell County was still 51 years behind for men, Putnam County was 14 years behind for men, and Marshall County was 20 years behind for women. In comparison, between 2000 and 2007, 80% (men) and 91% (women) of U.S. counties fell in standing against this international life expectancy standard. According to the study, these astonishing trends are largely fueled by smoking, high blood pressure and obesity in which West Virginia ranked 49th, 50th and 45th, respectively in 2010 (United Health Foundation). Here is a table listing the life expectancy data for counties in West Virginia.

The Washington Post has produced a great county map and you can find out more about how West Virginia counties measure up on other health statistics here.

Despite a slight decrease in the unemployment rate to 8.6 percent, West Virginia lost approximately 5,000 jobs in May 2011, the largest one-month drop since July 2009. The strong growth seen in April 2011 has been negated, and West Virginia currently has 11,700 fewer jobs than at the beginning of the recession. The state has only gained 900 jobs in 2011.

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West Virginia’s unemployment rate in April 2011 was 8.8 percent, down from a high of 9.7 in December 2010, but still more than double its pre-recession levels. So while the state is doing slightly better, it still has plenty of room for improvement. But did the recession affect all areas of West Virginia’s economy the same?

This chart shows seasonally adjusted total non-farm employment for West Virginia dating back to January 2008. As the chart shows, West Virginia experienced a solid year of job losses starting in September of 2008, as total non farm employment fell from 764,000 in September 2008 to 739,400 in September of 2009, a decline of 3.2%. Non farm employment remained stagnant for about five months, before starting to grow again in February 2010. Since February 2010, non farm employment has grown to 753,800, an increase of 1.9%.

This next chart shows changes in employment by sector, first during the downturn from September 2008 to February 2010 and then during the upswing, from February 2010 up to April 2011. This can show us which sectors were hit the hardest during the downturn, and which sectors are making the most progress.

The chart shows that the mining, construction, and manufacturing sectors were hit particularly hard. The mining sector fell by 3,700, a decline of 11%, construction fell by 7,300 for a 18% decline, and manufacturing lost 7,200, a 13% decline. In contrast, the health and social services sector saw an increase of 2,900, good for a 3% increase during the downturn. The government sector also saw modest growth at all three levels.

Since non farm employment began to grow again in February 2010, mining, retail trade, and professional and business services have seen the biggest gains. The mining sector has grown by 3,300, an 11% increase, retail trade has added 2,500, a 3% increase, and professional and business services have added 3,600, a 6% increase. Health and social services continued to grow, adding 3,600 for a 3% increase.

On the other hand, construction continued to decline, losing an additional 800, while manufacturing’s increase of 800 was minor compared to its loses of 7,200. And despite seeing minor growth during the downturn, federal and state government saw employment losses during the upswing. Growth remained stagnant across the rest of the economy.

A recent US Bureau of Economic Analysis report on State Personal Income reveals the extent to which the West Virginia relied on Transfer Payments to support total Personal Income between 2008 and 2009, a time when the Great Recession was wrecking havoc on state budgets and employment outlook was particularly bleak. Transfer Payments, primarily Unemployment Insurance benefits, but also the Supplemental Nutrition Assistance Program (food stamps), Temporary Assistance for Needy Families (TANF), and other social safety net programs was instrumental in leading the way to growing Personal Income between 2008 and 2009 despite contractions in Personal Income from all but three other states. This was especially important as West Virginia’s unemployment rates shot up to 8.5 percent, a significant uptick from the 4.1 percent that had existed on the eve of the Great Recession in December 2007.

You may recall from the previous blog that the three major components to calculating Personal Income include Earnings from Work, Dividend or Interest Income, and Transfer Payments from all government sources. A person either receives earnings from a place of employment, or income from capital investments such as dividends or interest payments from loans, or income from government programs.

2006-2007 Change in Personal Income

Prior to the Great Recession, West Virginia’s Personal Income increased 4.3% from 2006 to 2007, from $51.8 billion to $54.1 billion dollars lagging behind the 5.7% average increase for the US. During this pre-recessionary period, West Virginia experienced the 5th lowest increase in Personal Income among all 50 states and the District of Columbia.

2007-2008 Change in Personal Income

From 2007 to 2008, with the national economy cooling down the US average increase in Personal Income was 4% compared to the 5.7% change from the previous year. The West Virginia economy kept chugging along ahead of the US as Personal Income increased 5.7%, from $54.1 billion dollars to $57.2 billion dollars.

2008-2009 Change in Personal Income

And, here’s where it gets particularly interesting. From 2008-2009, as the full brunt of the Great Recession was bearing down on the states’ economies, Personal Income in West Virginia actually INCREASED 2.0% from $57.2 billion to $58.3 billion (see, Table 1 below). West Virginia’s increase in Personal Income was the highest among all fifty states and the District of Columbia between 2008 and 2009, as the US average change in Personal Income was a minus 1.7%. In fact, there were only three other states with a positive change in Personal Income from 2008 to 2009 as most states experienced negative changes in Personal Incomes, largely due to declining changes in earnings.

Why did this happen? This is the result of the state’s percent of income from Transfer Payments increasing by 10.2% compared to a -0.2% decline in Earnings by Work and from a -5.2% decline in Dividends and Interest Payments.

The increase in Transfer Payments by 10.2% from 2008 to 2009 was largely due to increases in benefits from the Unemployment Insurance Compensation program. Table 2 shows that Unemployment Compensation Benefits increased 55% compared to 7.5% Retirement & Disability Benefits, 7.7% Medical Benefits. Other significant increases in Transfer Payments were the result of a 17.1% increase in Income Maintenance Benefits such as Supplement Security Income (SSI), TANF, SNAP, and other General Assistance Programs. Further Veterans Benefits increased by 12.3% while Education and Training Assistance increased by 20.3%.

Personal Income increased an average 2.9% for the US between 2009 and 2010, a significant turnaround from the negative 1.7% from 2008 to 2009. West Virginia’s change in Personal Income was still higher than the US average with an increase of 3.6% from $58.3 billion dollars to $60.4 billion dollars. This time around, however, the increase of Personal Income in West Virginia was equally due to increases in Earnings by Work and from Transfer Payments, but Transfer Payments were still the leading cause of an increase in Personal Income in West Virginia from 2009 to 2010. Table 1 above shows that Earnings by Work increased 3.1% and Transfer Payments increased 5.6%.

The upshot of this analysis underscores the importance of ensuring the state’s Unemployment Insurance program is modernized in order to cover as many of our vulnerable unemployed as possible. The state’s Unemployment Insurance program disqualifies too many of our current jobless worker population. West Virginia should modify state policies that would allow the state to draw down the remaining $22 million in federal incentive payments while covering approximately 2,500 more West Virginians under the program.

The next blog will look at the impact of ARRA funding, as a percent of total Transfer Payments, on the state’s Personal Income during the Great Recession.

While there is a plenty of disagreement over how to handle the federal deficit and debt, one area almost everyone agrees on is the need for corporate tax reform. But while everyone agrees that the loopholes, deductions, and giveaways in the corporate tax code should be reigned in, both sides of the aisle also say the reform should be revenue neutral, meaning that the revenue raised by closing loopholes and removing deductions would be used to lower the corporate tax rate.

Critics point out that the U.S. corporate income tax rate is one of the highest in the world, at 35%. However, since there are so many deductions and loopholes in the code, that number is irrelevant. According to the Treasury Department, U.S. corporate income taxes are below average. Over the 2000-2005 period, U.S. corporations paid 13.4 percent of their profits in corporate income taxes, while other OECD (Organization of Economic Cooperation and Development) countries paid 16.1 percent of their profits in corporate income taxes.

Corporate tax revenue has also been nearly flat for decades, compared to individual income tax revenue. As the graph below shows, real corporate income tax revenue has seen almost no growth since 1969, before spiking during the housing boom, before falling off during the recession. In comparison, real individual income tax revenue has grown steadily since 1969, before dropping off from the Bush tax cuts, and again during the recession.

Source: White House Office of Budget and Management

So while corporations pay below average taxes in the U.S. and haven’t seen a substantial tax increase in 40 years, compared to American households, it seems as if corporate tax reform is a solid candidate for playing a role in deficit reduction. There is no reason why corporate tax reform needs to be revenue neutral, doing so will simply shift more of the burden of deficit reduction onto the middle class.

Working For a Shared Prosperity - The West Virginia
Center on Budget and Policy focuses on how policy decisions
affect all West Virginians, including low- and moderate-income
families, other vulnerable populations, and the important
community programs that serve them.